Deepwater Horizon litigation

The civil and criminal proceedings stemming from the explosion of Deepwater Horizon and the resulting massive oil spill in the Gulf of Mexico began shortly after the April 20, 2010 incident and have continued since then.

They have included an extensive claims settlement process for a guilty plea to criminal charges by BP, and an ongoing Clean Water Act lawsuit brought by the U.S. Department of Justice and other parties.

A federal judge, ruling on the Clean Water Act suit in September 2014, found that BP was primarily responsible for the oil spill as a result of its deliberate misconduct and gross negligence.

By May 27, 2010, Transocean, which owned the Deepwater Horizon, said in testimony before the U.S. House Judiciary Committee that it was defendant in 120 lawsuits, of which more than 80 were class actions seeking payment for financial losses covered by the Oil Spill Pollution Act.

"[3] At the same time UK media reported that over 130 lawsuits relating to the spill had been filed[4] against one or more of BP, Transocean, Cameron International Corporation, and Halliburton Energy Services,[5] although it was considered likely by observers that these would be combined into one court as a multidistrict litigation.

[5] Because the spill had been largely lingering offshore, the plaintiffs who claimed damages at that time were mostly out-of-work fishermen and tourist resorts that were receiving cancellations.

In July 2010, news reports claimed that BP had been attempting to hire prominent scientists from public universities around the Gulf Coast to aid its defense against the lawsuit that the federal government will bring as a result of the spill.

Robert Wiygul, who specializes in environmental law, said that he sees ethical questions regarding the use of publicly owned laboratories and research vessels to conduct confidential work on behalf of a private company.

[16]: 70 In April 2011, BP filed $40 billion in lawsuits against rig owner Transocean, cementer Halliburton and blowout preventer manufacturer Cameron International.

[18] In April 2023, The Guardian reported that BP had engaged in "scorched earth" legal tactics in fending off litigation from cleanup workers and others impacted by the spil, many of whom are low-income and suffer from long-term health effects.

[11][12] The Justice Department sought the stiffest fines possible, and has said it would seek to prove that BP "was grossly negligent and engaged in willful misconduct in causing the oil spill."

"[21] The case was carefully watched, because a ruling of gross negligence would result in a four-fold increase in Clean Water Act penalties, and would leave the company liable for punitive damages for private claims.

[29][31] DOJ attorneys state, "That such a simple, yet fundamental and safety-critical test could have been so stunningly, blindingly botched in so many ways, by so many people, demonstrates gross negligence.

In one email Guide remarked that Macondo was a very difficult well, that the drilling crew was "flying by the seat of our pants" under a "huge level of paranoia" that was "driving chaos" and concluded that "the operation is not going to succeed if we continue in this manner."

"[29][31] The DOJ also refused to accept BP's assertion that the Gulf's ecosystem has gone through a robust recovery and that the clean up is largely complete, saying that there is far more damage than meets the eye and more cleanup may need to be done.

[34] The third phase, set to begin in January 2015, will focus on all other liability that occurred in the process of oil spill cleanup and containment issues, including the use of dispersants.

[40] On August 13, BP asked US District Judge Carl Barbier to approve the settlement, saying its actions "did not constitute gross negligence or willful misconduct".

[29][44] Under the Oil Pollution Act of 1990, a company responsible is liable for only $75 million in economic damages, provided it did not exhibit "gross negligence" and the federal government picks up the next $1 billion.

[46][47][48] In October 2012, Judge Barbier rejected a request filed by Houston attorney Armistead Easterby to extend the deadline to opt out of the class action.

[50] BP also agreed to spend $105 million over five years to set up a Gulf Coast health outreach program and pay for medical examinations.

[52] On July 2, Judge Barbier appointed former FBI director Louis Freeh to conduct an independent investigation into allegations of improprieties within the Court Supervised Settlement Program.

[43] BP claimed the process was rife with fraud, and sued a Texas lawyer for allegedly representing tens of thousands of "phantom" clients.

"[54] In September 2014, Halliburton agreed to settle a large percentage of legal claims against it over the Deepwater spill by paying $1.1 billion into a trust by way of three installments over two years.

[60][61] Two employees have been indicted on manslaughter charges for acting negligently in their supervision of key safety tests performed on the rig prior to the explosion and failure to alert onshore engineers of problems in the drilling operation.

[59] On January 3, 2013, the US Justice Department announced "Transocean Deepwater Inc. has agreed to plead guilty to violating the Clean Water Act and to pay a total of $1.4 billion in civil and criminal fines and penalties".